In order to expand its theme park business, Comcast Corporation (CMCSA)-owned NBCUniversal is investing around $3.3 billion to build a theme park in Beijing. Comcast has partnered with Chinese investors for the purpose.
Through this, the company intends to diversify its revenue streams beyond its core telecommunications business (cable TV, high-speed Internet and telephony).
Comcast has received a go-ahead from the Chinese central government for the development of the theme park which will span across 300 acres of land. The Beijing site will mark the third Universal park in Asia after Singapore and Osaka. However, the inaugural date of the theme park has not yet been revealed.
The company foresees huge opportunity in China as the country has 11 out of the top 20 amusement parks in Asia. Notably, nearly 166 million people thronged the parks in 2013. According to AECOM – a global architecture and engineering firm – 59 additional theme parks are in the pipeline in China. AECOM also forecasts that China will overtake the U.S. in the theme park business by 2020.
With such impressive numbers, Comcast’s decision to extend its well-performing theme park business to China is deemed a strategic fit. In the second quarter of 2014, revenues from the theme park business had jumped 12.8% year over year to $615 million.
Comcast currently has a Zacks Rank #3 (Hold).
Other Stocks to Consider
Better-ranked stocks worth considering in this sector include Cablevision Systems Corporation (CVC), EchoStar Corp. (SATS) and Charter Communications, Inc. (CHTR). Cablevision Systems and EchoStar sport a Zacks Rank #1 (Strong Buy), whereas Charter Communications holds a Zacks Rank #2 (Buy).
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